6 Considerations in Choosing a Securities Company

Business Plan, Tips - Investing now seems to be a necessity and a lifestyle. Not only professionals, but there are also now many young people and even students who save and set aside their allowance to invest in various places, one of which is in the capital market.

To become a successful investor in the capital market, you must be smart in choosing a securities company where you are trading stocks.

Choosing a securities company is just as important as choosing the shares you want to buy.

Many considerations must be considered, and not all securities companies are suitable for all investors.

For those of you who are interested in investing in the capital market, here are 6 tips for choosing a securities company.

Have a legal permit

Surely you don't want to plant shares through an illegal securities company, right?

Not much different from choosing a bank where you save in terms of trust and legality, brokers in securities companies must have permission.

There are several permits that must be pocketed by a securities company. First, permission to become a Securities Broker Representative (WPPE). WPPE must have sufficient quality and knowledge about the world of capital markets, especially those relating to the sale of securities such as shares.

If the WPPE commits a violation, for example fraud, to investors, the permit will be revoked and the party gets a blacklist in the world of capital markets.

The second permit, the Underwriter Deputy (WPEE), or commonly referred to as the underwriter, is issued to a securities company whose function is to help prepare a company wishing to conduct an IPO (initial public offering) so that the company can sell its securities to the public.

The party that owns the WPEE may conduct activities as a WPPE, but does not apply otherwise.

Finally, permission as a Deputy Investment Manager (WMI) is a permit for the party who provides investment advice to buy or sell an effect, by getting compensation for his services.

Experience and reputation

Make sure you choose a securities company that has experienced and operated in this business for a long time and has a trusted reputation.

Do not rush into the offer of attracting securities companies before considering their track record.

Actually, every securities company may commit a violation due to system damage or human negligence.

But companies that break the rules a little show that they are committed to following the rules.

Also note how many investors use the services of the company.

If a broker serves too many customers, the quality of service will not be optimal.

High research ability

The third thing that could be considered is a high research capability.

A good securities company must have research and analysis that is competent, neutral and objective as its life.

This work is usually carried out by a Research Analyst, who is tasked with analyzing stocks, both fundamental and technical.

This is done to increase the selling value of a securities company in the form of recommendations and facilities offered.

These recommendations are good to consider when making investment decisions. If the results of recommendations issued by securities companies always benefit investors, the facilities provided are very good, so customers or investors will also feel comfortable using their services.

Along with the progress of the times, the function of research and analysis of securities companies can also be delegated to third parties or outsourced.

In addition, there are also securities companies that have small research teams, but often summarize research from various sources.

Capital and liquidity

A good securities company must have a high adjusted net working capital.

In general, the greater the capital owned, the stronger the securities company.

Securities companies can increase their MKBD in two ways.

First, by increasing the number of current assets.

The second way, by reducing the amount of their obligations.

Securities companies that have large fixed assets, in general, can be said to have poor financial structure, because securities operations mostly use current assets, mainly cash and securities.

So, you should avoid securities companies that have low liquidity, namely the comparison of fixed assets is greater than the current assets.

Both of these, capital and liquidity, are very important for you to pay attention to getting the securities company that is as expected.

Facilities Offered

Choosing a securities company means choosing the facilities and services offered.

Some important facilities that you should pay attention to are the existence of margin trading, reporting the placement of funds and the flow of funds that you transact, and annual reports.

With these facilities, you as an investor will be facilitated to know how your money works in the capital market.

Also, choose a securities company that provides stock portfolio recommendations and risk management.

Also, note whether the securities company you choose has facilities that allow you to monitor the latest data about stock trading and the movement of things around it.

This is important when you need information quickly in the face of price changes.

Another facility that is not less important is the online trading facility that allows you to transact anytime and anywhere.

Transaction fees

The last thing you should pay attention to in choosing a securities company is the fee or commission charged on the transaction that you do as an investor.

Choose a securities company that offers the lowest cost, but don't sacrifice service quality.

One way to assess its services is the number of recommendations from other people regarding securities companies.

Also, make sure the minimum deposit amount that you have to deposit to the securities company.

The role of securities companies is indeed very vital in stock transactions.

So, choosing a company that is the most suitable securities company for you is also very important in your investment activities.

Do not let you regret later if the securities company you choose goes bankrupt, goes bankrupt, and commits a violation such as fraud and misappropriation of investor funds.

In addition to reading articles like this, you can look for recommendations or suggestions about securities companies from relatives or friends who have experience investing their funds by playing shares in the capital market.

In addition to tips on finding a good securities company, you also need to know about 3 Super Quick Ways to Get Business Loan Funds. (vtK)

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